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The difference between the social and economic sciences as they exist in our world [Footnote: But see Gidding's Principles of Sociology, a modern and richly suggestive American work, imperfectly appreciated by the British student. See also Walter Bagehot's Economic Studies.] and in this Utopia deserves perhaps a word or so more. I write with the utmost diffidence, because upon earth economic science has been raised to a very high level of tortuous abstraction by the industry of its professors, and I can claim neither a patient student's intimacy with their productions nor—what is more serious—anything but the most generalised knowledge of what their Utopian equivalents have achieved. The vital nature of economic issues to a Utopia necessitates, however, some attempt at interpretation between the two.

In Utopia there is no distinct and separate science of economics. Many problems that we should regard as economic come within the scope of Utopian psychology. My Utopians make two divisions of the science of psychology, first, the general psychology of individuals, a sort of mental physiology separated by no definite line from physiology proper, and secondly, the psychology of relationship between individuals. This second is an exhaustive study of the reaction of people upon each other and of all possible relationships. It is a science of human aggregations, of all possible family groupings, of neighbours and neighbourhood, of companies, associations, unions, secret and public societies, religious groupings, of common ends and intercourse, and of the methods of intercourse and collective decision that hold human groups together, and finally of government and the State. The elucidation of economic relationships, depending as it does on the nature of the hypothesis of human aggregation actually in operation at any time, is considered to be subordinate and subsequent to this general science of Sociology. Political economy and economics, in our world now, consist of a hopeless muddle of social assumptions and preposterous psychology, and a few geographical and physical generalisations. Its ingredients will be classified out and widely separated in Utopian thought. On the one hand there will be the study of physical economies, ending in the descriptive treatment of society as an organisation for the conversion of all the available energy in nature to the material ends of mankind—a physical sociology which will be already at such a stage of practical development as to be giving the world this token coinage representing energy—and on the other there will be the study of economic problems as problems in the division of labour, having regard to a social organisation whose main ends are reproduction and education in an atmosphere of personal freedom. Each of these inquiries, working unencumbered by the other, will be continually contributing fresh valid conclusions for the use of the practical administrator.

In no region of intellectual activity will our hypothesis of freedom from tradition be of more value in devising a Utopia than here. From its beginning the earthly study of economics has been infertile and unhelpful, because of the mass of unanalysed and scarcely suspected assumptions upon which it rested. The facts were ignored that trade is a bye-product and not an essential factor in social life, that property is a plastic and fluctuating convention, that value is capable of impersonal treatment only in the case of the most generalised requirements. Wealth was measured by the standards of exchange. Society was regarded as a practically unlimited number of avaricious adult units incapable of any other subordinate groupings than business partnerships, and the sources of competition were assumed to be inexhaustible. Upon such quicksands rose an edifice that aped the securities of material science, developed a technical jargon and professed the discovery of “laws.” Our liberation from these false presumptions through the rhetoric of Carlyle and Ruskin and the activities of the Socialists, is more apparent than real. The old edifice oppresses us still, repaired and altered by indifferent builders, underpinned in places, and with a slight change of name. “Political Economy” has been painted out, and instead we read “Economics—under entirely new management.” Modern Economics differs mainly from old Political Economy in having produced no Adam Smith. The old “Political Economy” made certain generalisations, and they were mostly wrong; new Economics evades generalisations, and seems to lack the intellectual power to make them. The science hangs like a gathering fog in a valley, a fog which begins nowhere and goes nowhere, an incidental, unmeaning inconvenience to passers-by. Its most typical exponents display a disposition to disavow generalisations altogether, to claim consideration as “experts,” and to make immediate political application of that conceded claim. Now Newton, Darwin, Dalton, Davy, Joule, and Adam Smith did not affect this “expert” hankey-pankey, becoming enough in a hairdresser or a fashionable physician, but indecent in a philosopher or a man of science. In this state of impotent expertness, however, or in some equally unsound state, economics must struggle on—a science that is no science, a floundering lore wallowing in a mud of statistics—until either the study of the material organisation of production on the one hand as a development of physics and geography, or the study of social aggregation on the other, renders enduring foundations possible.